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CONFIDENTIAL
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ECGD INFORM US THAT PROCEDURAL ARRANGEMENTS TO SECURE CREDITORS ACCESS TO PROCEEDS OF THE OPERATION OF THE TUNNEL'' MEANS NEITHER MORE NOR LESS THAN CREATION OF A FUND HOLDING ARRANGEMENT WHICH WILL ENSURE THE AVAILABILITY OF PROCEEDS, IF THE
TUNNEL IS PROFITABLE, TO COVER OUTSTANDING LOAN REPAYMENTS. THE PRECISE FORM OF THIS IS A MATTER FOR NEGOTIATION BUT CLEARLY IT MUST
BE DESIGNED TO PREVENT EQUITY SHAREHOLDERS MILKING COMPANY WHILST EAVING FIXED RATE LENDERS TO CARRY FUTURE RISKS, IT WOULD ALSO OFFER SHAREHOLDERS CHANCE OF EARLY LOAN REPAYMENT IF THEY WISHED TO DO SO, THIS IS A NORMAL FINANCING ARRANGEMENT WHEN EQUITY CAPITAL IS RELATIVELY LOW IN RELATION TO FIXED INTEREST LENDING, AS. IN THIS CASE. OBVIOUSLY THE FUND ARRANGEMENTS WOULD PROVIDE FOR FAIR RETURN ON EQUITY CAPITAL WHILST LOAN WAS OUTSTANDING. ба PLEASE PASS COPY TO HANNAM.
STEWART.
FILES
H.K.D.
FAR EASTERN D.
I.P.D.
F.P.A.D.
TRADE POL. D.
EX. PROMOTION D.
MR. MORETON
MR. COMBS
AAAAA
CONFIDENTIAL
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